Annual investments in leadership development exceed $350 Billion worldwide. Yet researchers are beginning to question the wisdom of all this money pouring into training with little measurable ROI. According to Harvard business publishing’s 2018 state of leadership development report, “millennials feel today’s leadership development programs lack innovation, on-the-job impact, and expertise from outside sources.” Other reports echo the same sentiment. Jeffrey Pfeffer of Stanford University reflects this when he states, "It is not just that all the efforts to develop better leaders, decades such effort notwithstanding, have failed to make things appreciably better... it makes things much worse.”
While there are many reasons why leadership development may not provide the impact of its intent, one reason seems to be paramount. Training is divorced from organizational values, cultures, and systems. Local universities and colleges offer degrees and training in leadership, except when students go back to their organizations, they cannot implement because of entrenched leadership systems.
As Deming famously said, “a bad system will beat out a good person every time.”
To illustrate the problem, many feel that the military is the best at developing leadership. This is because no one puts more emphasis on leadership development than the military. In a conversation with General Barry McCaffrey, a retired 4-Star General who took a cabinet position in the Clinton Administration explained to me that every rank has a school in the US Army. The different schools to teach students how to execute the specific requirements of each rank. They are not simple eight-hour classes with a computerized test at the end. As General McCaffrey explained to me, when he became a one-star general, he had to attend a nine-month school to be a one-star general. When he became a two-star, three-star, and four-star – each required a nine-month school. This training was specific to the US Army.
In contrast, “Too many training initiatives we come across rest on the assumption that one size fits all and that the same group of skills or style of leadership is appropriate regardless of strategy, organizational culture, or CEO mandate” (Pierre Gurdjian, Thomas Halbeisen, and Kevin Lane). A one size fits all strategy is the equivalent of the US Army, giving a nine-month degree program to directors of social service nonprofits. The context is wrong. The rules, routines, and behaviors expected of a two-star general will be very different than the CEO of a social service organization providing emergency housing to victims of domestic violence.
Organizations are a network of interlocking systems. Each system defines roles, rules, responsibilities, and routines. One of these systems is the leadership system. The solution, therefore, is to design the training to the requirements of each unique organization. For example, a manufacturing organization adopts servant leadership as the backbone of its leadership system to engage employees to find and eliminate waste. The system requires leaders, managers, production leads, and supervisors to be mentors to their workforce. They have even changed the traditional names for mangers to mentors. Therefore, every leader is trained to be a mentor to their staff.
There are five practical impacts of this approach to leadership development:
- Every leader or manager understands their role in developing their staff. They know that the front-line worker will find and eliminate waste in the manufacturing processes.
- Therefore, managers must respect the voice and experience of their staff.
- Leaders and staff understand how their specific roles will impact broader strategic priorities.
- Leaders who insistent on being problem-solvers for their staff will be frustrated.
- To maximize the impact of the system, it must be measured, analyzed, and continuously improved.
There are two challenges to this approach to leadership:
- Leaders who expect to lead based on personal values and skills may find being trained to lead based on organizational values and required skills may be angry. During an interview of a retired CEO of a healthcare organization that received the Malcolm Baldrige Quality Award for Excellence said when I asked him how his leadership team reacted when he began to design a system of leadership said, "half of them walked out."
- To fully realize the impact of leadership as a system means that every leader, including the CEO, will need to be evaluated against the requirements of the system. The most effective organizations I found that consistently enjoyed employee engagement scores ranked with the highest nationally were organizations that evaluated every leader and manager against their staff's levels of engagement.
The first step in designing a system of leadership is to determine the output of the system. This is where the power lies. It is also how elite organizations define and develop the employee experience. While many organizations spend a great deal of energy, managing the customer experience, elite organizations put equal energy into designing the employee experience. Based on my research, organizations that consistently perform at the highest levels design an employee experience based on what is meaningful to them. Just like they would a customer. We found experiences that resulted in long-term performance, including employee safety, respect, relationship, empowerment, engagement, servant leadership, and love.